ORLANDO—A lawsuit alleging USA Transporter Services misclassified workers
in an attempt to avoid paying mandatory taxes on their behalf reflects a
growing rise in earnings or “wage and hour” disputes in Florida and around the
“It’s a 10 to 12-year trend of an increased number of wage and hour
claims,’” David Gevertz, an attorney with Baker Donelson who specializes in wage
and hour disputes, recently told the Florida
Record. “A large part of those claims allege that they were improperly
classified as an independent contractor when they were really an employee.”
The Record reported earlier
this month that Santiary Rivera and Hector Burgos filed a collective action lawsuit
on Dec. 16 in the Orlando Division of the U.S. District Court for the Middle
District of Florida, alleging the defendant violated the Fair Labor Standards
Act (FLSA) and the Florida Deceptive and Unfair Trade Practices Act.
plaintiffs allege their former employer misclassified them as independent
contractors to avoid paying employment taxes and made illegal deductions from
their earnings to pay insurance on company vehicles.
In every industry “there tends to be a push to try to make people independent
contractors so (the employer) can hold down compensation while getting more
money into the pockets of workers and bypassing all the taxes,” Gevertz said. “The
only entity that ends up with immediate harm is the government that is supposed
to be collecting those taxes.”
American workers are protected by the federal FLSA of 1938 and by the
labor laws of each state. Still, a 2011 study by the National State Attorneys
General Program at Columbia Law School showed that standing behind a law is
just as important as having it on the books.
“Without meaningful enforcement by state
regulators, employers will simply disregard legal obligations if doing so
allows them to save time, money or effort, putting the majority who wish to abide
by the law at a significant competitive disadvantage,” the report stated.
A problem inherent with an allegation of misclassification is the lack
of a cohesive, consistent definition of “independent contractor” among the IRS,
the U.S. Dept. of Labor and the courts, Gevertz said. “As an attorney to an employer,
I can never answer with 100 percent confidence that they’ve made the right
decision.” This difficulty in pinning down consistent criteria leads to
businesses spending significantly more on labor to avoid the risk, or
endangering their entire business model by taking a risk, Gervertz said.
Enforcement—or lack of it--affects the worker, their family, and their
community, as well as the business that is striving to be legally compliant
while trying to survive a competitor’s illegal and less costly practices.
Given the current climate of employment-related litigation, “Employers
would be smart, before they end up in the crosshairs of an audit or lawsuit, to
hire someone with expertise in this area,” Gevertz said.
“Too often, someone
says, ‘All my competitors are using independent contractors. That’s the only
way I can stay in business.’ So there’s an assumption that if everyone’s doing
this, it must be lawful. Unfortunately, that’s not the case,” Gevertz said.
The plaintiffs are represented by Luis A. Cabassa of Wenzel Fenton
Cabassa PA in Tampa.
U.S. District Court for the Middle
District of Florida, Orlando Division Case number 6:16-cv-02158